There could be a major shift in the balance of power in the boxing industry in the U.S. after Richard Schaefer, the CEO of Golden Boy Promotions, tendered his resignation on Monday afternoon.
"After more than ten years with Golden Boy, it is time to move on to the next chapter of my career,’’ Schaefer said in a statement that he released through his publicist. “I am proud to remain a shareholder, so I have a strong interest in the continued success of the company. I am proud of what we have accomplished at Golden Boy, but I now look forward to new challenges."
It was not a surprise announcement. The lawyers for Schaefer and Oscar De La Hoya, the founder and President of Golden Boy, have been haggling over a separation agreement for the past month. Schaefer has a non-compete clause in his contract, so speculation that he will run Floyd Mayweather’s promotion company seems to be idle chatter for now.
Shortly after Schaefer made his announcement, Leonard Ellerbe, President of Mayweather Promotions, said that Floyd Mayweather, Jr. will no longer do business with Golden Boy Promotions. There is also the question of just how many of boxers, who are clients of boxing power-broker Al Haymon and fought on Golden Boy Promotion cards the last few years, are actually under contract with Golden Boy. And who will De La Hoya hire as the next CEO of Golden Boy Promotions?
These are all sticky questions that have to be sorted out and will determine the future of Golden Boy Promotions, which rose to be one of the most powerful companies in the boxing industry under Schaefer’s guidance and with Mayweather fighting under its banner for the last five years.
Schaefer, a former personal banker with the Swiss company UBS, was De La Hoya’s banker until De La Hoya left Promoter Bob Arum of Top Rank Promotions in 2007. De La Hoya and Schaefer partnered to form Golden Boy Promotions.
Schaefer oversaw remarkable growth of Golden Boy Promotions, taking it from a small promotion company to one of the top in the industry. He presided over two of the biggest boxing events in the history of the sport – De La Hoya-Mayweather, which did 2.5 million pay per views and generated $136 million in revenue and Mayweather-Saul Alvarez, which did 2.2 million pay per view buys and generated a record $150 million in revenue.
A rift between Schaefer and De La Hoya became public the week that Floyd Mayweather, Jr. fought Marcos Maidana in Las Vegas on May 3. De La Hoya met with Arum at his home in Los Angeles earlier that week to try to mend their fractured relationship, though De La Hoya said they never talked about doing business together during that meeting.
At the time Schaefer said he didn’t like the fact that De La Hoya was trying to mend his relationship with Arum, who promoted De La Hoya for the majority of his boxing career.
“His entire career that’s what Bob Arum thrives on is to have these feuds. It used to be with Don King for a long time,’’ Schaefer said to reporters back in May. “I just don’t appreciate being treated that way, being called names, being disrespected and basically at the turn of a light switch you think the next day everything is fine. It just doesn’t work for me.’’
Arum said he doesn’t like the fact that Schaefer is making him the villain in his departure from Golden Boy Promotions.
“The thing I resent most is Schaefer using me as the scapegoat, using my relationship with Oscar, as the reason that he left,’’ Arum said. “Anybody with half a brain knows that’s not the case. Oscar believed that he was looting the company by not signing fighters and handing fighters over to (Al) Haymon and breaching his fiduciary duties.’’
With De La Hoya in and out of rehab the last couple years, Schaefer has been in charge of the direction of the company. Now that he is emerging from his treatment, De La Hoya wants to regain control of the direction of the company.
“Oscar was like Rip Van Winkle, asleep he didn’t know what was going on. He came out of rehab and all of this was going on,’’ Arum said.
It appears that Schaefer’s cozy relationship with Haymon and his refusal to do business with Arum upset De La Hoya. At a press conference before the Mayweather-Maidana fight, De La Hoya said he didn’t know how many of the fighters represented by Haymon who have been fighting under the Golden Boy Promotions banner in the last couple of years are actually signed to agreements with the company.
Arum said that will determine whether Schaefer’s departure from Golden Boy will result in a cosmic shift in the boxing business.
“First of all who does Oscar have in Golden Boy that makes an impact? One guy he has that we know he has is Canelo Alvarez. Canelo is a valuable product. No question about it,’’ Arum said. “Does he have any of the welterweights? Does he have (Amir) Khan and (Danny) Garcia? Are they with Golden Boy or are they with Haymon? If he does, yeah it shakes up the landscape because they can be opponents for Manny (Pacquiao), (Timothy) Bradley and (Juan Manuel) Marquez. If they’re not tied to Golden Boy, then it’s business as usual.’’
That will have to be sorted out before Arum gets involved in any fights involving Golden Boy Promotion boxers. That includes a possible mega match between Pacquiao and Canelo Alvarez.
“In order for there to be matchups Oscar has to say we have X signed to me and we have a guy he can fight,’’ Arum said. “Then we can make the fight. I’m not going to rush in and do something and get my ass sued.’’